Advice? Am I crazy? My plan to become a billionaire.
Hello
I just want to start off with wanting some advice and criticism from people.
My plan is as follows;
- Work in IB 3 years.
- Go to top 5 B school.
- Go into PE.
- Work up to MD--preferably early in career (maybe 36?)
- Work as MD till 48.
- Start my own financial firm. This is where I am kind of torn. I don't know if I would want to start an IB, PE firm, or holdings company. Never HF or VC, I would hate that.
Is there any general advice anyone can give? I know the world will change tremendously in the next 30 years of my life (I am still in college).
looks good thx, one minor comment: add age 49 - lose virginity
You forget intelligence !
Depends - which college do you go to?
Lol the college you went to could actually impact your odds of success. Ex: if you want to Harvard, your chances of becoming either a billionaire or an UHNW individual are much higher. See below:
https://en.m.wikipedia.org/wiki/List_of_universities_by_number_of_billi…
the real question is what follows what, 1. does a great individual that is destined to be a billionaire simply exists and decides to go to Harvard or 2. is Harvard responsible for their success? because for me it was, it is, and it will always be the first option.
and I thought it was already well-known that Harvard/Ivies pick candidates with huge potential and then, after decades, the school takes pride in how their success is attributed to the school they went when their success is 100% their merit (--> school is considered top quality --> attracts more people --> bigger candidate pool thus higher chances of picking quality students among many --> quality students get accepted --> they accomplish great things --> Harvard takes pride in that --> school is considered top quality, and the cycle repeats itself on and on)
there would had been no difference for a Zuckenberg going at Harvard vs. Kentucky
for finance is a bit different, you'll make more money because you'll have a red carpet for recruiting at top banks that promise better exits at buy-side, but that's a far cry from being a billionaire, at best you get $10-20M by your 40/50s
You forgot to add the part where you build a unicorn out of your parent's garage while in college working a part time job which you then sold to PayPal for give or take 1 billion which you then invested in a rocket company that ultimately made you the first person to land on mars.
Ignoring the rest of this since who knows what will happen in your career, but for your early career planning you can't go IB -> Bschool -> PE. No PE firm will take you out of MBA with no prior PE experience. You need to do oncycle (which happens before you even start in IB) to land your PE role, 2 years of IB and then 2 years of PE. After that you can decide to continue in PE or do an MBA (most skip the MBA these days, it's expensive and not needed)
Even assuming you hit the first 5 bullets in stride without much resistance, that still puts you at about 97% away from your goal. A successful PE partner with maybe a decade of tenure at the partner level probably has maybe a net worth of low-to-mid 8 figures in an absolute best-case scenario, assuming several successful exits. So getting to that point is probably like a <5% probability outcome if you tally the numbers from an entire "vintage pool" of IB candidates that start their career in a given year and count the number of candidates that achieve that outcome ~20 years later.
Then you're back at square 1 with starting your own investment firm in your 40s and you're still 97% away from your goal of being a billionaire because your NW is only ~30 million and you're 45 years old. Let's assume the economics of PE is still attractive in 20 years and you can still make bank by running your own firm. From here, the path to 10 figures is much less linear than it was for you when you climbed the ranks from IB to PE partner. Your new firm can flame out and you could possibly lose most of your NW. Or you could become a middling PE shop where you actually make less per annum than what you made at your top-tier firm when you were a partner clipping your checks.
Ok. So it's very hard and not entirely straightforward to scale your new PE venture into a successful multi-billion dollar AUM firm over the course of many years. That's why there are so few UMM / MFs and most of those had first mover advantage, meaning they opened up shop in the 90s / 00s before private equity was a mainstream investment product. This allowed them to grow AUM quickly due to less competition and successful early investments.
So we've established that starting at square 1 (opening your own PE firm, assuming you easily hit the first 5 bullets of your plan) and scaling your firm is incredibly hard, and the probability outcome of that is maybe ~1% among all new PE firms. So take 3% * 1% and those are your odds.
It's like saying "I want to a top 10 richest person in the world, here is my plan for starting my own tech company...". The issue with this line of thinking is even if you are successful along every step of the way in your plan, you'll still likely be 99% away from your goal. That's just math, there can only be 10 richest people in the world and there can only be XXXX billionaires, for every person that aspires to be one (there are many).
EDIT: the math is illustrative ballparking but the real final number is probably way lower.
And life is full of its vagaries too
iggs writing tombs on a “how can I get rich” thread like clockwork. Happy Thanksgiving man
Cheers.
everyone here is a hater. bro how do i invest in you?
I’m down to short him we can make something happen
I would say it’s certainly fair to conclude that the ceiling in finance is very high, and you can realistically become very wealthy in this field. You would have to be a business owner, be significantly impactful and innovative and also have luck to make a billion+. I think the luck aspect is big - many of those billionaires who if born again to fill the shoes of a 20 year old today even with the same skills, knowledge and resources can undoubtedly become very successful, but may not necessarily be able to replicate the exact same result again today
Additionally if this post is even real, the last thing you should do is let people, especially internet strangers, tell you what your ceiling is, you don’t really know who is actually giving advice behind your screen, could be some washed out loser for all you know
Would instead think the more important question for you and for people to address is: what can you do to best position yourself for success in the field, if this is truly the career plan you have
Lol fair you don't become a billionaire or anywhere near that by taking advice on internet forums, this is moreso a page just for job and recruiting related advice, maybe a page that helps with some technical aspects of the job
Guys it’s a troll post
Not neccesarily poor quality though – at least it elicits informed/informative responses
Fair point
I am quite curious, troll post or not, how wealthy PE partners usually become.
$50-$100mm net worth by retirement for Partners at large funds ($3bn+)
Several senior but non-founding and non-IC sitting senior partners at my UMM are well into the low 9 figure net worth territory
It is hard to define retirement in PE as people eventually get pushed out, even partners. But if you really retire in PE (meaning in your sixties), you should be worth way more than that given you would have been a partner for 15-20 years.
The thing is the median partner tenure is probably around 5 years and then they go on to do something else and the figure above is probably within the ballpark.
Knew a kid from my HS whose parent followed this exact path, except founded a hedge fund instead of PE firm. He’s worth over half a bil, so you may need to revise your forecasts a bit
Partners in PE at decent size funds often net 50mm+
Founders much more
etc)
bro, you have a guy who did all that is only worth $4m at age 40. It's on full display in the other forum
He worked in private credit though, which in some places like KKR, doesn’t even get carry on their funds these days, or very minimal (400k at pc partner vs millions in PE)
He was also only 40 supposedly, so likely just recently got promoted to that title. Give it 10-15 years and he'd be worth much more, even if he was working in credit (much lower return profiles and low to no carry, which is very different from pe)
An1 - You don't know what you're talking about. At all
If you want to learn more about compensation, there are a lot of pdfs on it for people at each level, fund size etc. Here's an example:
https://www.heidrick.com/-/media/heidrickcom/publications-and-reports/n…
Wow this is quite a helpful compensation guide for PE, thank you
You have a better chance going to a hot unicorn with experienced founders then starting your own thing to become a Billionaire than doing IB > PE
By the time you are 48 AI will have wiped out the PE industry.
Good luck, though!
Cap
Me personally- I'd hold off on starting a financial firm until the age of 49.
bro says he has a crazy plan to become a billionaire; then, it turns out to literally just be IB -> PE -> MBA -> PE
I think it’s very important to think about the options and to plan the career. Understand why and how people are successful
that said as a 2000’s engineering graduate I have 2 friends who are in the B club and neither could have imagined the path they took
life is very random and instead of planning the course I’d encourage you need to seize the opportunity at hand
What did your friends do?
Founded unicorn startups.
I have been able to meet a few billionaires who have made their money off of their funds. The only way they could do that was their partners already had capital of $5M+ (adjusted for inflation) and could do a Buffett-style buy and hold as well as leading IPO cap tables to get to the 10-figures club. They also went into the funds straight out of graduate school (all top schools) or worked for >10 years before joining the funds they are still at. As stated in previous comments, they could only have these opportunities due to their networks.
Network is everything. It’s who you know not what you know. Op look at what people like Brad Lightcap did. He will most likely be a Billionaire if he continues playing his cards right.
You can skip a few steps.
Here:
Step 1: purchase wso credits
Step 2: be born rich.
Try that and let me know how it goes
topkek nice stinker
There are ~4,000 billionaires in the world (according to my 3-second google search). I'm rounding up to nearest thousand. There are 8 billion people in the world. Statistically speaking, you have a better chance of meeting Kobe than Bezos. But hey who am I to crap on someone's dreams.
You thinking wrong life to short. You don't know if you will live to be 48. Go buy a business now go look into search fund or fund less sponsor. Find a deal the money will come. Stop buying in this corporate dreams Bs take a leap of faith.
You forgot step zero:
Be born with a high-functioning personality disorder (e.g. psychopathic or sociopathic tendencies) or neurodivergence (i.e. Asperger's / high-functioning autism)
I’m not so sure they skipped that step
not enough info
Nobis numquam ad eius magni voluptates. Vero praesentium totam autem quos. Velit ipsa pariatur doloremque reprehenderit.
Amet quisquam qui asperiores aut distinctio. Dolorem facere quaerat corrupti molestias illo. Aut dignissimos est explicabo sint libero totam.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Et et facere labore rerum. Consequatur illum doloribus veniam repellat similique explicabo ut dolore. Soluta aliquam perferendis perferendis illo. Sit neque officia ea molestiae ratione quae.
Eligendi sit voluptas velit et ut eius. In autem ad et voluptatum. Libero veniam iure quia sed sed soluta.
Qui a et qui voluptatibus inventore. Rerum reiciendis sit officia fugiat voluptates. Maiores ullam voluptatem quas repellat eaque libero. Facere eum aut omnis fugit. Facilis sit aliquam nihil rerum officia. Eveniet velit quibusdam consequatur ipsa.
Corporis tempora est quis et. Earum sit quia sint et sunt necessitatibus eius. Beatae qui voluptate voluptates est quia assumenda fugiat in. Et ut adipisci rerum. Consequatur perspiciatis eligendi eos sed.
Omnis facilis assumenda fugit provident et repellat officiis. Harum aut pariatur corporis minima eaque in tempora. Voluptatem fuga recusandae occaecati accusamus alias earum dicta iure.
Sit et temporibus expedita delectus dolor accusamus laudantium. Tenetur doloremque aut nam sunt placeat.